The pattern of higher highs/higher lows is a classic in technical analysis and that is what the Dec S&P is enjoying at the momentum. Last Wednesday saw a strong move higher for the contract and it has traded sideways since then. This is a fairly reliable indication that the market is poised to head higher as new shorts grow frustrated with the lack of downside. Daily momentum studies are overbought but this is more of a confirming signal when accompanied with a bullish signal from out Trend Intensity study.
One other focus is sentiment, and the equity-only put/call ratio is not yet showing the kind of optimism seen last May, so until the market seems to be leaning too far overboard, the path of least resistance to toward higher levels.
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